Vendors and Other Independent Contractors

This information is provided to assist you in understanding the coverage being offered and does not modify the terms and conditions of any insurance policy, nor imply a claim is covered. Specific coverage terms vary by class of business. See your policy for full details.  

Very often a special event organizer will invite vendors to participate in the organization’s special event.  Vendors may sell food and beverages, or perhaps arts and crafts.  Vendors are an example of independent contractors.  In addition to vendors, event organizers may hire independent contractors to provide other necessary activities, such as security or clean up.  If the activity requires a license, such as a security operation, be sure to check that the license is current.  Independent contractors should sign hold harmless agreements protecting the special event organizer and should carry their own insurance.  The independent contractor should provide evidence of this insurance coverage by providing you with a certificate of insurance.  The special event organizer should request that it be named as an additional insured on the independent contractor’s insurance policy.  If the independent contractor does not carry insurance, then your organization is placed at risk by its operation.  Remember too, special event organizer’s general liability insurance policy will not protect the independent contractor in the event of an accident arising out of its operations.  And, even though the special event organizer may not be at fault, it could still be pulled into an expensive and time consuming lawsuit if its vendors are not properly insured for both liability and workers’ compensation.  Here is another example of a special event organizer faced with a lawsuit because its independent contractor was uninsured:

A special event organizer rented a building.  The entry area was dirty, so the special event organizer hired a local cleaning company. The cleaner came and scrubbed the floor and left it wet without any signs indicating that it may be slippery.  A woman walked into the building and slipped on the wet floor breaking her ankle. The special event organizer was held financially responsible for the woman’s medical bills because warning cones were not used.  If the cleaner had carried insurance, his or her policy would have probably picked up most of the damages.  And, if the vendor had named the special event organizer as an additional insured, the cleaner’s policy would also have defended the special event organizer in the lawsuit.  But since the cleaner was uninsured, the special event organizer bore the cost of everything.

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